If you are interested in investing in a rental property you are examining several factors to determine your return on investment. Then, you finally find a place that seems perfect-low property cost, high rent, great residents, and only some minor maintenance that needs to be done. However, there is one small catch- it is a 45-minute drive away. You figure that you won’t mind the drive, and won’t even have to visit the property most of the time and invest. Everything looks great, so what could possibly go wrong?
While there is nothing wrong with purchasing a property that is not near to where you live, it can pose some unique problems, and driving costs add up. To start with, residents do not stay forever. Indeed, the average resident for a single-family home will last a year and a half. People purchase their own homes, move for job opportunities, and other life events can result in a resident turnover.
Once your resident leaves, you will need to get the property cleaned and prepared for the next tenants. You can hire professionals to do this work, but at the very least you will need to drive to your rental property to do an evaluation of what needs to be done, and then a return trip to ensure that your vendors did the work as expected. If your vendors have missed a few small things, then this may require additional trips on your part.
Once your property is all ready for new residents, you will need to advertise your property. Did you remember to take pictures when you inspected your vendors’ work? If not, then you will need to do another trip. Also, for each showing, you will want to make a trip. On average it takes 7 to 15 showings to find a quality and qualified applicant. You could try to schedule multiple showings for the same day(s), but often what works for your timeframe does not work for applicants’ schedule, and so you should plan on several trips.
Once you have found a resident that you are excited about, you will need to make an additional trip for the move-in process. However, residents often have several follow up requests soon after moving in, whether it be a question on how to operate the dishwasher to small maintenance requests, and so you will need to plan a handful of trips within the first few weeks after move-in.
So now have a great new resident who pays the rent on time. Everything goes smoothly for a few months, but then the toilet overflows. Your resident must be at work and is unable to meet the plumber, and so there is another trip for you. No problems for a few more weeks, but then your resident has an altercation with a neighbor over the weekend, and there goes your Sunday. Everything goes smoothly for the next few weeks, but then a fuse blows, but your resident cannot find the fuse box, shutting off the heater in the middle of the winter…and you get a call at 3 am.
While at one time you may have thought that the 45-minute drive seemed like no big deal, it’s now a drain on not only your time but also the cost of gas, as well as wear and tear on your vehicle. How much is your time worth? That 45-minute drive each way for all the various aspects that you will need to take care of will add up.
Purchasing a property in a neighboring city can be a great investment with the low purchase price, high rent, and solid residents that you had initially anticipated. However, the time and cost of the day-to-day duties can turn that dream investment into a nightmare.
At Real Property Management DC Metro our job is to make investing in rental property easy and deliver a big payoff. Don’t continue to let your driving costs add up, contact us online or call us at 202-269-0303 today and learn how you can save.
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